Financial service operators are using misleading statements and fear tactics to convince Australia to switch their super funds.
A review by the corporate watchdog into lead generation activity found multiple instances where licensees did not have measures in place that stopped high-risk superannuation switching.
The Australian Securities and Investments Commission report said there were examples of unlicensed or unqualified lead generators, which exposed many oversight failures of licensees.
ASIC Commissioner Alan Kirkland said the license of financial services was at risk if lead-generating methods were used.
"ASIC's work in recent years has exposed how business models involving slick sales tactics to convince people to switch their super can expose Australians to serious financial harm," he said.
"Consumers should not feel pressured or misled when making important financial decisions.
Of the 15 licensees reviewed by the commission, more than 7600 customers were gained through lead generation between January 2025 and June 2026.
The targets of lead generators invested about $678 million following referrals, with more than 90 per cent of the funds coming through superannuation.
The review found five licensees did not have controls in place that prohibited high-risk superannuation fund changing.
A further four licensees were operating businesses that had some features of high-risk superannuation switching.
The report said instances were found of unqualified lead generators using potentially misleading statements and fear-based claims to convince people to change their investments.
Non like-for-like comparisons were also used as a way to persuade investors to review their superannuation arrangements.
The review of lead generation practices follows the collapse of Shield and First Guardian, which led to 12,000 investors losing a combined $1 billion.
In many instances, people who invested in those funds were advised to do so after being approached by a lead generator.
"The poor approach to oversight taken by some licensees is unacceptable, particularly considering the scale and volume of business generated from these arrangements," Mr Kirkland said.
"Commercial incentives must not come at the expense of consumers."
